National should extend the UFB rollout
THE NATIONAL Party could pull a rabbit out of the hat when it announces its ICT policy in the next week or two by extending its flagship $3.5 billion ultrafast broadband initiative.
The ultrafast broadband (UFB) initiative is progressing satisfactorily despite the controversies and ill-temper surrounding the financial squeeze on telecommunications network company Chorus. More than half a million homes, businesses and schools now have access to UFB, and a respectable 39,500 have signed up to a service. But the current plan is to roll out the network to only 33 cities and towns, covering about 75 per cent of the population.
That was always a rather arbitrary cutoff, designed to cap taxpayers’ contribution to the scheme at $1.35b, and it has thrown up some anomalies. On the West Coast, for example, Greymouth is getting UFB, but Hokitika and Westport aren’t, even though the cost of deployment, per premise, in the three towns probably wouldn’t be that different. As UFB take-up increases and more services are delivered over the network, the inequities have the potential to distort some regional economies.
The policy parallel is perhaps with Freeview. The Government originally planned 75 per cent of television viewers would get access to the terrestrial FreeviewHD broadcast service, which offers channels in HD, with the rest of the country having to make do with the inferior standard-definition satellite Freeview service.
But in 2010, when it was clear FreeviewHD was a success, the Government elected to increase its coverage to 87 per cent of the population.
The way FreeviewHD and UFB are delivered are very different; one involves building radio towers and the other digging trenches. But an increase in UFB coverage to 80 to 90 per cent of the population might be possible without greatly increasing the percapita cost of the scheme.
Outside the footprint of the UFB initiative, broadband infrastructure has been improving as a result of the $285m Rural Broadband Initiative (RBI), but that scheme, funded by an industry levy, doesn’t have quite the same promise. About 230,000 rural homes and businesses now have access to faster fixed-line copper broadband and/or a fixedwireless broadband service delivered by Vodafone using its cellphone towers and rooftop antennas as a result of that scheme. Chorus reported that as of a year ago, about 35,000 of them had taken advantage of better copper broadband. The number of customers connected to Vodafone’s wireless service was 6064 at the end of June which is not stellar.
Drawbacks of the wireless service include a low standard data traffic cap of 15 gigabytes, which can only be boosted to 30Gb to 65Gb, depending on the reseller, before steep charges of $30 a gigabyte kick in if you go over your limit. Only fixed-line broadband services can deliver the data caps and low lag that households need to enjoy online games and internet television at a price that most will be prepared to pay.
Communications Minister Amy Adams hinted at the possibility of extending the UFB initiative in March, when she said the Government was looking at how it could fill in gaps left by the UFB initiative and RBI. She noted the latter ‘‘as good as it is, is not the same as ultrafast broadband’’. At the same time, Adams reckoned any tweaks to improve both schemes would probably cost less than $285m. The pressure on the party to be ambitious has increased. Some of Labour’s policies to boost internet connectivity are ‘‘bitty’’ and administratively complex but some of its other ICT policies have captured imagination, including a plan to offer $10,000 ‘‘garage grants’’ to technology start-ups. Meanwhile, the Internet Party is wooing the internet generation, saying its objective is to see UFB rolled out to another 22.8 per cent of the population, to achieve 97.8 per cent coverage, and to cut copper broadband pricing in half.
A widening of the UFB initiative, perhaps funded by an extension of the levy used to fund the RBI, seems the logical response.